Drastic and Incremental Change

 Shrinkage

According to US experience, much downsizing is really 'dumb-sizing', since two-thirds of the companies who have slashed workforces in recent years report no increase in efficiency. Most of us try to create a state of order and predictability around our jobs. Restructuring can destroy this. Cowboy management in these circumstances can destroy long-term commitment since restructuring removes many of life's certainties. No longer can we count on a job for life with any one company, but some sense of direction is essential to preserve motivation and obtain the best performance. Neither can people be expected to cope with overwork caused by excessive cost-cutting.

 "From a company's standpoint, the decision to terminate a group of employees is fraught with potential legal, financial and public relations consequences," said Thomas Silveri, president and chief executive officer of DBM. "It is critical that managers communicate the news of layoffs in a professional, legal and humane way in order to treat the departing employees with sensitivity and to maintain a respectful corporate image."

Read: Tips for Handling Layoffs on the HRM Guide USA site.

  Incremental change

In the 1960's and 1970's, change often came under the label of organizational development (OD), relying on a methodology described as Action Research . This was an undramatic - but effective - long-term change process based on incremental improvements, effectively on a continuous flow of emergent strategies. With the advent of modern change programmes such as business processing re-engineering (BPR), this low-risk and long-term approach has gone out of fashion. (...)

Competitive pressures often demand a faster, more dramatic process than action research. Many modern managers would question whether their organization had the time required. More pertinently, we can ask if ambitious executives on short-term contracts have enough time to make their mark with such a slow methodology. It is likely that a glossier and more public method will be better appreciated. This is provided by packaged, or 'off-the-shelf', approaches, which begin with top management and are cascaded down the organization. They are normally dramatized, with considerable emphasis on communication and a spotlight placed on the lead personality. (...)

 Read a sequence of articles in Government Executive which details the story of total quality management (TQM), Quality Circles, etc: Cornerstones of Quality Business process re-engineering (BPR). 

Re-engineering is a methodology of the 1990s that has inspired many change strategies. The Technique was first publicized by Hammer (1990) in a Harvard Business Review article entitled 'Re-engineering work: do't automate, obliterate'. In typical guru fashion he outlined amazing benefits in a range of companies, proclaiming the existence of seven fundamental principles of re-engineering:

* Organize around outcomes, not tasks.
* Those who use the output should perform the process.
* Information processing work should be subsumed into the real work that produces the information.
* Geographically dispersed resources should be used as though they were centralized.
* Link parallel activities instead of integrating tasks.
* Decisions should be taken where work is performed and control built into the process.
* Information should only be captured once - at source.

Pages 176-180 of Human Resource Management in a Business Context review the claims attached to BPR, pointing to the frequent failure to achieve claimed benefits. Evidence shows that this may, at least in part, be attributed to a focus on technical rather than human issues.

Everything you ever wanted to know about BPR at the brint.com site

Working paper on 'Re-engineering of Business Processes in Multinational Corporations' by Michael Kutschker